The underlying technology is separate and it's one of the reasons it drives me nuts when my mom calls and says her friend told her to buy Ripple.(Anyone interested do some googling Ripple is basically everything bitcoin is not, and not in a good way)

If there is no token and it's missing something that replicates nakamoto consensus, I don't really consider it blockchain; with a decentralized, secured, immutable ledger. Many things seem to masquerade as blockchain or crypto when they aren't. The underlying technology does not need to be a "currency" but it does require a token.

Also, I'm not defending ripple. I've debated about it before and do not understand value in it.

FWIW there's no such thing as "paid shills" because there is no bitcoin corporation.

That's a terribly unconvincing argument, in this specific instance.

Because all of the easy money in cryptos is built around speculation, and speculation is fostered by internet forums. We already know that small bands of active crypto posters on reddit have deliberately and repeatedly manipulated public sentiment about specific altcoins immediately after converting their holdings. It's classic pump and dump. Buy into ripple, have three respected (but relatively anonymous and apparently unaffiliated) internet posters spend a week talking about how awesome ripple is, and then sell out of ripple at 50% gains. Rinse and repeat for Monero, and Litecoin, and whatever else you think you can convince people to buy. This sort of coordinated market manipulation has been hugely profitable for a core group of early adopters, because so much of the crypto market is based on internet rumors anyway. How do you think ~40 internet-famous 20-somethings each turned $10k into $50m in two years? It sure wasn't riding BTC up and down. They got in and out of the crazy cycles they helped to control.

So you don't need a bitcoin corporation to be a paid shill, because you can be an independent shill. Crypto markets are so fragile, so volatile, that it only takes a handful of thoughtful and well educated writers to "generate" a billion dollars in market cap in a few weeks time. There is no underlying revenue stream on which to base valuations, so it's purely 100% speculation and rumor. Those can be manufactured by people like you. All discussion of the technology itself is just smoke.

Any time you (anyone, not you specifically) promote a coin that you hold, you are playing this game on a small scale. If you're doing it with big money, or in coordination with other internet personas, then you're playing it on a grand scale. This stuff is blatantly illegal when wall street does it, but crypto is still the wild wild west.

I don't know what it is, I don't know how to use it, I don't know anyone who actually uses it, I don't know what the practical use of it is. I don't understand it, so I won't put hard earned USD backed by strongest economy and military in history of mankind on something I don't know.

I know a lot of people aren't smart enough to use it or how to use it or how it works like me.

And it seems there's always some new crypto coming out, what are you supposed to use? Do vendors accept? I don't know if you can even use this in daily life. Can you tax it? To me this crypto is a bad idea right now. Maybe in the far future may work.

crypto traders value their investments using bitcoin as their frame of reference. Entire crypto portfolios are valued by how much each alt is worth when it is converted to bitcoin, and when things get rough, or btc gets bullish that is what they do. The "shitcoin" speculation of obscure alts within the crypto community is entirely based around creating an increased amount of bitcoin for the speculator/ TA trader.

You can't qualify this for all crypto traders. These statements are not wholly true. Many people do not acquire other coins to increase their bitcoin stack.

You are correct, these statements are not wholly true, and I should have phrased them as such.

I edited that section several times and for brevity cut off the sections describing how many coins have devoted followers who have no desire to own any other coin. My observations were made based on the (admittedly limited) cross section of social media crypto trading "experts" and the replies of their followers(many have hundreds of thousands of followers) and from the short 2 to 3-degrees-of-separation from me out to(again limited) acquaintances in the crypto community.

There are distinctly different segments of the crypto population from HODLers of various coins to TA traders to social media wizards to my aunt calling to tell me her friend bought cardano and it's awesome and I should buy some - speculative noise.

There are other coins such as Eth that seek to offer a different type of value which can and do exist in parallel with btc. They compete for investor money in the short term but occupy different tech territory in a longer timeline. BTC currently cannot execute smart contracts the way eth can(though this is purportedly in the works), and eth is centralized and mutable and much more suitable as a platform for decentralized app development and an overall platform for incorporating blockchain tech esp into the corporate realm, rather than a global financial instrument.

Eth is not centralized. Eth is as immutable as bitcoin. Your statements about eth are untrue.

Apologies for the terminology error. Eth is mechanistically decentralized in that it is supported by a global community of miners.

Eth is politically centralized in that one private entity, The Ethereum Foundation, which has no distributed consensus mechanism for decision making, has authority over it. Which they have used to alter the blockchain, see the DAO hard fork:

Yes, Vitalik Buterin has said he only did it because the tech was nascent. If it's possible for an individual entity to make such a move, then no, the ledger is not immutable, no matter how much he says he won't do it again. If you have evidence to the contrary I would be heartened to hear it as I think Eth has tremendous potential.

The value of a blockchain can be best understood through metcalfe's law - the value of a communications network is the square of the participants. This explains neatly (if imperfectly) why twitter is worth billions but the group chat with me and my aunt and grandma is worth nothing, other than to the 3 of us.

Network effects are meaningless metric for bitcoin relative to other blockchains. In blockchains, network effect can be replicated and is not exclusive to bitcoin. Network effects, in the current phase of crypto, are also very fleeting.

Agreed, network effects can be replicated on any blockchain. Disagree, that you can ignore network effect because of this.

Thought experiment:

Imagine enough users jumped ship from bitcoin to bitcoin cash such that their userbase was swapped, because it provided better utility or their memes were better or whatever. All the HODLers switched sides, all the everyday users, everything.The very act of all those users selling their btc to obtain bcash to do their transactions(even if their transaction was buy coins and hold them) would swap the market caps as their supply is nearly identical, and network effect analysis would again be useful for determining how much more utility all the new bcash users were receiving over those stuck on old btc.

People can't transact with coins they don't have and the act of acquiring them to do so drives up the value - metcalfe's law in action. It is not a perfect tool and would be difficult/impossible to use it to ascribe dollar numbers to an individual blockchain, but it is useful for comparing two or more blockchains.

Market cap is misleading from this perspective. For example, bcash appears overvalued, it has a market cap 1/7th of btc.

Number of transactions per day is one gauge of the overall participation rate on a blockchain.

Bcash network averages roughly 20k transactions per day. Bitcoin averages roughly 200k transactions per day. Given a roughly equal number of users making transactions (which may be off by a moderate margin in either direction) Metcalfe's law indicates that this is not a 10 fold difference, rather an exponential difference in network utility. The price gap is only a factor of 7, while from a value standpoint bitcoin may provide 100x utility(give or take reasonable calculation errors) over bcash!

These are assumptions and are not conclusive.

??These are not financial numbers, just a back-of-napkin attempt at showing the amount of utility that each blockchain is offering to its end users compared to their relative market caps.

The microsoft blockchain analysis cited earlier in the thread assessed that alternate blockchains to btc sacrificed either decentralization or immutability or both in order to obtain advantages in speed and efficiency. A SQL database on a server somewhere would vastly outperform bitcoin from a performance standpoint, but would have neither decentralization nor immutability and thus there would be no reason to trust it to authorize financial transactions.

Microsoft's conclusion was that second layer protocols to the bitcoin blockchain are the best solution for scaling without sacrificing the underlying fundamentals of btc and by and large the crypto community agrees.

It's not clear yet how or which ones microsoft will coordinate layer 2 protocols on. "Some public blockchains (Bitcoin [BTC], Ethereum, Litecoin, to name a select few) provide a solid foundation for rooting DIDs, recording DPKI operations, and anchoring attestations....To overcome these technical barriers, we are collaborating on decentralized Layer 2 protocols that run atop these public blockchains to achieve global scale, while preserving the attributes of a world class DID system."

Yes that is an excellent point and I can see how what I wrote came off different than what I intended.

Microsoft is researching using the open-source btc codebase(or possibly other blockchains) and then writing their own second layer protocols to make use of it. None of this would have any impact on the value of whichever open source blockchain they chose other than purely through the lens of public perception.

I also should not have made any generalizations about what the crypto community endorses or does not endorse. It's an incredibly diverse group and any speculation to overall trends about what is supported is merely a guess.

I should have said that btc developers support a second layer option to increase throughput. I personally believe this is the highest value approach, as so far the blazing-fast/cost effective competitors like ripple have suffered from mechanistic centralization or political centralization or both, and as such I do not trust them with any of my transactions. The foundations of BTC that protect the participants and ensure immutability and security are glaringly absent.

FWIW there's no such thing as "paid shills" because there is no bitcoin corporation.

That's a terribly unconvincing argument, in this specific instance.

Because all of the easy money in cryptos is built around speculation, and speculation is fostered by internet forums. We already know that small bands of active crypto posters on reddit have deliberately and repeatedly manipulated public sentiment about specific altcoins immediately after converting their holdings. It's classic pump and dump. Buy into ripple, have three respected (but relatively anonymous and apparently unaffiliated) internet posters spend a week talking about how awesome ripple is, and then sell out of ripple at 50% gains. Rinse and repeat for Monero, and Litecoin, and whatever else you think you can convince people to buy. This sort of coordinated market manipulation has been hugely profitable for a core group of early adopters, because so much of the crypto market is based on internet rumors anyway. How do you think ~40 internet-famous 20-somethings each turned $10k into $50m in two years? It sure wasn't riding BTC up and down. They got in and out of the crazy cycles they helped to control.

So you don't need a bitcoin corporation to be a paid shill, because you can be an independent shill. Crypto markets are so fragile, so volatile, that it only takes a handful of thoughtful and well educated writers to "generate" a billion dollars in market cap in a few weeks time. There is no underlying revenue stream on which to base valuations, so it's purely 100% speculation and rumor. Those can be manufactured by people like you. All discussion of the technology itself is just smoke.

Any time you (anyone, not you specifically) promote a coin that you hold, you are playing this game on a small scale. If you're doing it with big money, or in coordination with other internet personas, then you're playing it on a grand scale. This stuff is blatantly illegal when wall street does it, but crypto is still the wild wild west.

That's not a good thing, the west was ugly.

Hmmm. That is very thought provoking and makes me want to not talk crypto anymore. Thank you.

Agreed, trying to protect from hyperinflation by investing in something hyperinflationary would make no sense whatsoever.

Using a tiny sample such as the prior 8 weeks of purchasing power loss without accounting for coin supply/cap, long term trends, or analysis of how a diminishing-supply, universally accessible currency would behave in the event of a government-backed currency's failure appeared to be willful ignorance and signaled an end to logical debate. I guess I misinterpreted?

Okay, let's see your data then. I would love, love, love, to be wrong. I love stats and numbers, and especially economics, so seeing coin supply/cap, long term trends, and analysis of how a diminishing-supply, universally accessible currency would behave in the event of a government-backed currency's failure is right up my alley. So please post your analysis. I'm ready for the deep dive. I'm serious as a heart attack. Spreadsheets are my thang. I really, really, want to see your analysis. I'm on board.

Oh, and "willful ignorance?" You gotta admit that things like how a "diminishing-supply, universally accessible currency would behave in the event of a government-backed currency's failure" isn't something that most people have experience with. I mean, I didn't learn about it in college. And I have no personal experience with it either.

Agreed, trying to protect from hyperinflation by investing in something hyperinflationary would make no sense whatsoever.

Using a tiny sample such as the prior 8 weeks of purchasing power loss without accounting for coin supply/cap, long term trends, or analysis of how a diminishing-supply, universally accessible currency would behave in the event of a government-backed currency's failure appeared to be willful ignorance and signaled an end to logical debate. I guess I misinterpreted?

Okay, let's see your data then. I would love, love, love, to be wrong. I love stats and numbers, and especially economics, so seeing coin supply/cap, long term trends, and analysis of how a diminishing-supply, universally accessible currency would behave in the event of a government-backed currency's failure is right up my alley. So please post your analysis. I'm ready for the deep dive. I'm serious as a heart attack. Spreadsheets are my thang. I really, really, want to see your analysis. I'm on board.

Oh, and "willful ignorance?" You gotta admit that things like how a "diminishing-supply, universally accessible currency would behave in the event of a government-backed currency's failure" isn't something that most people have experience with. I mean, I didn't learn about it in college. And I have no personal experience with it either.

I'm PM'ing you and happy to go over it to you to the extent of my knowledge, which is limited.

We all don't know what we don't know. Sol pointed out some things that I didn't know that were quite disturbing. I'm not going to continue this discussion publicly as I refuse to be, even indirectly, a part of any of what he described. I've amended my initial post as well.

FWIW there's no such thing as "paid shills" because there is no bitcoin corporation.

That's a terribly unconvincing argument, in this specific instance.

Because all of the easy money in cryptos is built around speculation, and speculation is fostered by internet forums. We already know that small bands of active crypto posters on reddit have deliberately and repeatedly manipulated public sentiment about specific altcoins immediately after converting their holdings. It's classic pump and dump. Buy into ripple, have three respected (but relatively anonymous and apparently unaffiliated) internet posters spend a week talking about how awesome ripple is, and then sell out of ripple at 50% gains. Rinse and repeat for Monero, and Litecoin, and whatever else you think you can convince people to buy. This sort of coordinated market manipulation has been hugely profitable for a core group of early adopters, because so much of the crypto market is based on internet rumors anyway. How do you think ~40 internet-famous 20-somethings each turned $10k into $50m in two years? It sure wasn't riding BTC up and down. They got in and out of the crazy cycles they helped to control.

So you don't need a bitcoin corporation to be a paid shill, because you can be an independent shill. Crypto markets are so fragile, so volatile, that it only takes a handful of thoughtful and well educated writers to "generate" a billion dollars in market cap in a few weeks time. There is no underlying revenue stream on which to base valuations, so it's purely 100% speculation and rumor. Those can be manufactured by people like you. All discussion of the technology itself is just smoke.

Any time you (anyone, not you specifically) promote a coin that you hold, you are playing this game on a small scale. If you're doing it with big money, or in coordination with other internet personas, then you're playing it on a grand scale. This stuff is blatantly illegal when wall street does it, but crypto is still the wild wild west.

That's not a good thing, the west was ugly.

Hmmm. That is very thought provoking and makes me want to not talk crypto anymore. Thank you.

Just wanted to comment that sol's post is not in any way speculative or conspiracy-theory oriented. We have definitely seen several new brand new users pop up, post one time about their scam ico / pump-and-dump "shitcoin" (linking to their blog that's similarly singularly focused in their signature), and then promptly disappear forever after the mods removed it. I have flagged one or two for the mods to look at myself.

Cryptocurrencies are absolutely in the wild west, and it will be very hard for them to climb out of that untrusted state. It seems every single week (if not day) you hear about yet another ICO scam, a new exchange exit scam / "getting hacked", a new coin-mining malware / unethical websites using your browser to mine without telling you / people using university / government / corporate computers to mine for them (illegally / unethically). Add on top of that the regular old giant speculative bubbles where regular Joes get tricked into "investing" at the top due to the FOMO, possible (probable?) regular old fraud that's underwriting maybe a third of the crytpo market from Tether, the correct fact that cryptos are in fact used to a large degree for purposes that would otherwise be illegal / unethical, and the difficulty of convincing people that an asset that has no fundamentals or revenue stream or traditional value proposition is an "investment".

I don't know if the proper solution is just to stop talking about it whatsoever, I actually probably agree that cryptocurrencies are here to stay and will have some sort of very-long-term value proposition. But at some point just throwing the "do your own research" and "don't invest more than you're willing to lose" and "well you should have known not to store your money on an exchange" buzzwords around is not sufficient, and will make people suspicious of your ulterior motives. Cryptos are burning through public trust very quickly right now. There has never been a more clear argument *for* financial regulations that I've ever seen.

As I proofread this post and review yours to make sure I responded to the important ideas you raised, it occurs to me that I may be Charlie Brown with the football here, and your entire post may have actually been an elaborate dismissal. Fingers crossed!

It wasn't, it was an honest question, although I'm obviously fairly sceptical of the current state of cryptos.

If I may summarize your response, you believe that Bitcoin will be the long-term winner because the momentum of the large current user / merchant / developer base will allow it to react and evolve faster than anything else could grow. You may be right but I actually hope you're not. Bitcoin seems to be one of the worst cryptos in regard to energy requirements for mining, and I don't agree that mining will become less valuable if Bitcoin continues to be king. That adds up to a terrible waste of energy just because people are unwilling to move to a better solution.

I meant to mention it earlier but I found your comparison to Linux interesting. I think it's probably a fair comparison, but not in the favourable way you meant it. I think an individual cryptocurrency is probably comparable to an individual Linux distribution, not to the whole Linux ecosystem. Linux distributions come and go and gain and lose popularity all the time. And yes, there are some big players who stay relevant for a long time. But there are no guarantees, and since everything in the Linux world is open source and freely available there is nothing to prevent some upstart from creating their own distribution that does something better and convincing a huge portion of the userbase to switch. It's a safe bet that Linux as an operating system will stay relevant forever. Any individual distribution not so much.

FYI, Surf, you've mentioned the forum search function a couple times. It's borderline-worthless; the best way to search the forum is to just use Google and site:forum.mrmoneymustache.com to filter the results.

FYI, Surf, you've mentioned the forum search function a couple times. It's borderline-worthless; the best way to search the forum is to just use Google and site:forum.mrmoneymustache.com to filter the results.

You are absolutely correct, thank you. I did notice the forum search was ineffective and used that method. And felt kind of silly for not doing it immediately, haha.

It's somewhere in the Shame and Comedy section. I'm certain we've taken that particular kitchen device out behind the tool shed.

I did not realize that was tongue-in-cheek. I got my vitamix 9 years ago on a refurb sale and have used it daily since then. It's more than paid for itself as I was burning out blenders about once a year before getting mine. Just used it to make a lunch smoothie and it's still kicking!

It's somewhere in the Shame and Comedy section. I'm certain we've taken that particular kitchen device out behind the tool shed.

I did not realize that was tongue-in-cheek. I got my vitamix 9 years ago on a refurb sale and have used it daily since then. It's more than paid for itself as I was burning out blenders about once a year before getting mine. Just used it to make a lunch smoothie and it's still kicking!

Everybody should have the ability to chop food. It's the $500 device that will miraculously cure all your ills that some folks here take issue with.

People who burn out blenders confuse me. I've got a 1970s Osterizer (it has some fancy faux wood panelling on the side so I figure it's from the 70s?) that I've been using since before university. I blend shit all the time. Everything from green kale or red beet smoothies, to breaking up ice for mixed drinks, to pureeing stuff to thicken drinks. That thing has had constant use for years, and provided you occasionally oil the spinny parts (I use some olive oil) it seems like it will never die.

Just wanted to comment that sol's post is not in any way speculative or conspiracy-theory oriented. We have definitely seen several new brand new users pop up, post one time about their scam ico / pump-and-dump "shitcoin" (linking to their blog that's similarly singularly focused in their signature), and then promptly disappear forever after the mods removed it. I have flagged one or two for the mods to look at myself.

Cryptocurrencies are absolutely in the wild west, and it will be very hard for them to climb out of that untrusted state. It seems every single week (if not day) you hear about yet another ICO scam, a new exchange exit scam / "getting hacked", a new coin-mining malware / unethical websites using your browser to mine without telling you / people using university / government / corporate computers to mine for them (illegally / unethically). Add on top of that the regular old giant speculative bubbles where regular Joes get tricked into "investing" at the top due to the FOMO, possible (probable?) regular old fraud that's underwriting maybe a third of the crytpo market from Tether, the correct fact that cryptos are in fact used to a large degree for purposes that would otherwise be illegal / unethical, and the difficulty of convincing people that an asset that has no fundamentals or revenue stream or traditional value proposition is an "investment".

Agreed the ICO scamcoin phenomenon is in desperate need of regulation, it's a black eye on the crypto community.

Agreed the FOMO speculator aspect is a problem, as is the periodic bubble cycle it drives. People have and will get burnt. Users whose only goal is to resell later at a profit provide no value to the network and take away from the entire point of the technology and interfere with its adoption.

The malware issue is separate. I was a victim-witness in a federal trial when a computer of mine was hacked. It was used as part of a botnet for an ad click scheme that stole a staggering amount of money. The issue with distributed mining malware is with computer security.

Tether may or may not be fraud, I cannot verify so I do not use it. There's what, 2bln tether? The crytpo market cap is ~450bln right now. I have not done research to determine the overall price shift that would occur if tether were to be fraudulent. The exchanges make so much money that there is a non-zero chance that it's actually backed by USDs.

The illicit activity topic I cannot verify or deny without data. I'm a tax paying law abiding citizen and do not use crypto for illicit activity. Nearly all forms of money are used for criminal purposes.

I don't know if the proper solution is just to stop talking about it whatsoever, I actually probably agree that cryptocurrencies are here to stay and will have some sort of very-long-term value proposition. But at some point just throwing the "do your own research" and "don't invest more than you're willing to lose" and "well you should have known not to store your money on an exchange" buzzwords around is not sufficient, and will make people suspicious of your ulterior motives. Cryptos are burning through public trust very quickly right now. There has never been a more clear argument *for* financial regulations that I've ever seen.

As I proofread this post and review yours to make sure I responded to the important ideas you raised, it occurs to me that I may be Charlie Brown with the football here, and your entire post may have actually been an elaborate dismissal. Fingers crossed!

It wasn't, it was an honest question, although I'm obviously fairly sceptical of the current state of cryptos.

If I may summarize your response, you believe that Bitcoin will be the long-term winner because the momentum of the large current user / merchant / developer base will allow it to react and evolve faster than anything else could grow. You may be right but I actually hope you're not. Bitcoin seems to be one of the worst cryptos in regard to energy requirements for mining, and I don't agree that mining will become less valuable if Bitcoin continues to be king. That adds up to a terrible waste of energy just because people are unwilling to move to a better solution.

Yes, cautiously. Its fundamentals are sound and being the largest means the most utility offered. I don't think it will react faster, but it is upgradeable and many desirable features are in development. It just has to evolve those features the community desires before they leave for a different blockchain.

Owning a cryptocurrency is kind of like owning a telephone. You don't have to make calls on it every day to derive utility. The fact that you are available to make or receive calls(in this case send or receive funds) contributes value to the network. If you're the only one with the phone, it's useless. If much of the world has it(or at least entities you want to , it's valuable.

The energy use is an issue yes. The amount of miners competing for rewards is likely outpacing the adoption rate. However, scaling the network to more users is not linked to the amount of mining power required to verify the network. Also since electricity is an operating cost the miners are incentivized to use renewables because they are cheaper.

I too hope a more energy efficient, yet still secure, algorithm gains traction.

I meant to mention it earlier but I found your comparison to Linux interesting. I think it's probably a fair comparison, but not in the favourable way you meant it. I think an individual cryptocurrency is probably comparable to an individual Linux distribution, not to the whole Linux ecosystem. Linux distributions come and go and gain and lose popularity all the time. And yes, there are some big players who stay relevant for a long time. But there are no guarantees, and since everything in the Linux world is open source and freely available there is nothing to prevent some upstart from creating their own distribution that does something better and convincing a huge portion of the userbase to switch. It's a safe bet that Linux as an operating system will stay relevant forever. Any individual distribution not so much.

That is an excellent point.

Corporations like facebook are very good at creating profit, but vulnerable to being overtaken by competitors(RIP myspace). Open source distributions like Linux are very good at offering value to the userbase, and often fold would-be competitors into their community, but generate little profit. As a result they are more resilient.

The overlap here is that the fiscal value of a blockchain network is directly linked to the utility value offered to the user base. Basically, a linux-style approach may yield the highest utility product, which is also the highest fiscal value product. In this instance there is no corporation to pay profits to, so anyone who participates in the network benefits from the increased value, until it reaches equilibrium. Whether equilibrium is 0 users or millions will decide the fiscal value.

The reason scamcoins are valueless is A) noone uses them(metcalfe's) and B) they rarely do anything better than the established blockchains.

Agree completely that any one distribution/coin may or may not be relevant on a long time frame.

Bitcoin "distribution" variants come as hard forks, where an owner of 1btc receives 1 of the new version of the bitcoin open source, if it becomes successful. Thus by holding bitcoin you obtain all future versions.This is NOT the case for non-btc competing blockchain technologies, which makes paying attention to the top market players important. If one offers better value, and you hold $5k of bitcoin, you can sell it for $5k of Coin X if its long term prospects are higher. This requires research and vigilance.

People who burn out blenders confuse me. I've got a 1970s Osterizer (it has some fancy faux wood panelling on the side so I figure it's from the 70s?) that I've been using since before university. I blend shit all the time. Everything from green kale or red beet smoothies, to breaking up ice for mixed drinks, to pureeing stuff to thicken drinks. That thing has had constant use for years, and provided you occasionally oil the spinny parts (I use some olive oil) it seems like it will never die.

That's awesome! They don't make 'em like that anymore. The modern shiny $75 blender has all plastic gearing, no matter how much stainless they waste on the outside. If you blend frozen fruit the gears get shredded in short order.

Buying a $500 vitamix to try and cure your health is silliness.

I bought one for $250 refurb because I burned out 2 blenders in 2 yrs, and I use it daily(usually breakfast or lunch, but also for soups and sauces) and have stopped contributing to landfills and saved $ astonishingly. It's neither pretty nor shiny(i got the lowest model) but it's all metal gears and an effective tool.

Tether may or may not be fraud, I cannot verify so I do not use it. There's what, 2bln tether? The crytpo market cap is ~450bln right now. I have not done research to determine the overall price shift that would occur if tether were to be fraudulent. The exchanges make so much money that there is a non-zero chance that it's actually backed by USDs.

Surf, as a new member, it's been suggested you post elsewhere for a while, outside the crypto space. Yet, you've now on post #30, all in the same crypto thread.

I think you're at risk of getting banned at this point. Please take a break from this controversial thread. MMM forums don't need this.

Devils advocate here... A lot of his posts and responses have been well thought out and he's not simply telling people to buy XYZ coin. He's posting in a cryptocurrency thread which is where cryptocurrency conversation is supposed to happen. If he was spamming cooking, real estate, case study threads, etc with crypto talk then it would make sense to mention banning. If other MMM members don't want to see a "controversial" thread topic like cryptocurrencies then simply don't click the thread or have the Mods remove the thread all together.

Surf, as a new member, it's been suggested you post elsewhere for a while, outside the crypto space. Yet, you've now on post #30, all in the same crypto thread.

I think you're at risk of getting banned at this point. Please take a break from this controversial thread. MMM forums don't need this.

Devils advocate here... A lot of his posts and responses have been well thought out and he's not simply telling people to buy XYZ coin. He's posting in a cryptocurrency thread which is where cryptocurrency conversation is supposed to happen. If he was spamming cooking, real estate, case study threads, etc with crypto talk then it would make sense to mention banning. If other MMM members don't want to see a "controversial" thread topic like cryptocurrencies then simply don't click the thread or have the Mods remove the thread all together.

The point is that if all you have to offer in 3 days as a new member is 30 posts in support of crypto, you probably came to the wrong forum altogether.

I agree with that assessment but just wanted to point out at least he's not spamming other threads. Time will tell if he dives into other areas with as much gusto.

Surf, as a new member, it's been suggested you post elsewhere for a while, outside the crypto space. Yet, you've now on post #30, all in the same crypto thread.

I think you're at risk of getting banned at this point. Please take a break from this controversial thread. MMM forums don't need this.

It's been a 2-way conversation so far, and a couple posters may have even changed his mind on a few points. It's definitely a controversial and niche subject, but it's not like he's been close minded. We've had far worse appear here in those regards.

So you don't need a bitcoin corporation to be a paid shill, because you can be an independent shill. Crypto markets are so fragile, so volatile, that it only takes a handful of thoughtful and well educated writers to "generate" a billion dollars in market cap in a few weeks time. There is no underlying revenue stream on which to base valuations, so it's purely 100% speculation and rumor. Those can be manufactured by people like you. All discussion of the technology itself is just smoke.

Any time you (anyone, not you specifically) promote a coin that you hold, you are playing this game on a small scale. If you're doing it with big money, or in coordination with other internet personas, then you're playing it on a grand scale. This stuff is blatantly illegal when wall street does it, but crypto is still the wild wild west.

That's not a good thing, the west was ugly.

Yes, certain communications by those in control of companies or markets to pump-and-dump stock are illegal and the SEC can take legal action because of it. It is in no way illegal for the average Joe to talk about why he chooses to hold (or not) stock XYZ. Nothing like the SEC is watching over those in control of crypto-currencies or their exchanges making this the wild wild west; and it looks like there has been plenty to be concerned about in this realm. Based on what I have read by @Surf here I don't think that he is a part of that. You could reasonably argue that all most of on this forum are guilty of promoting securities that we hold (usually in the form of low-cost index funds). I appreciate the arguments based on the differences between the types of securities (companies doing business to create profits vs. tokens that do nothing other than represent their volatile value on an immutable decentralized public ledger).

I've appreciated the bits of actual discussion of the technology behind crypto-currency that has appeared on this thread. I'm a bit of an optimist about the long term prospects of crypto-currency, but not enough to convince me to invest in it (huge learning curve to understand it well enough to not just be the greater fool). I imagine that some of my optimism stems from my libertarian political leanings - a currency that is not in the control of the government sounds very nice in the context of a libertarian utopia; but I have enough experience with my political leanings to know that pragmatism can be much more effective than idealism.

@Surf, you ought to start a thread about your surfing hobby (especially if you can focus on keeping the hobby frugal). Eventually someone will come along promoting some spendypants surfing equipment as "totally worth it" and you'll see just as much gusto in facepunching them. That's the culture here. @sol can be quite interesting to read when he's talking about stuff that he likes, but like you, I tend to dislike his style when responding to things he disagrees with.

Surf, as a new member, it's been suggested you post elsewhere for a while, outside the crypto space. Yet, you've now on post #30, all in the same crypto thread.

I think you're at risk of getting banned at this point. Please take a break from this controversial thread. MMM forums don't need this.

Devils advocate here... A lot of his posts and responses have been well thought out and he's not simply telling people to buy XYZ coin. He's posting in a cryptocurrency thread which is where cryptocurrency conversation is supposed to happen. If he was spamming cooking, real estate, case study threads, etc with crypto talk then it would make sense to mention banning. If other MMM members don't want to see a "controversial" thread topic like cryptocurrencies then simply don't click the thread or have the Mods remove the thread all together.

The point is that if all you have to offer in 3 days as a new member is 30 posts in support of crypto, you probably came to the wrong forum altogether.

So my official position on crypto is that I fully support blockchain technology and crypto, in my current view, is the best way to bring blockchain tech to the point where these other technologies become economically and socially viable. I also see that our official currencies are also mostly based on trust and speculation (this is obviously ignoring other economic factors such as production and earnings) and so see crypto as a new globalised currency that, using smart contracts, can help both businesses and individuals who transfer large sums across borders.

That said, I mine Ethereum and invest it into a tokenised Index fund inspired by the S&P 500. It's called Crypto20, and as the name suggests, it holds 20 of the top performing coins on the market. I feel that this significantly reduces my risk and allows me to focus on the long-term gains.

I invested $1800 in November at $0.8 per coin and the current value is roughly $2 after 4 months. That puts my potential earnings at $1440. I only put in as much as I was willing to lose. Now I mine and use what I make from mining to invest in Crypto20. Within the next few months, I plan to withdraw the cost of my miner $2500 and the initial $1800 to break even, leaving the mined Crypto20 fund for the next 10 years. I may not withdraw the initial cash injection, instead, leaving it to mature, or not, as I was willing to lose it in the 1st place.

So my official position on crypto is that I fully support blockchain technology and crypto, in my current view, is the best way to bring blockchain tech to the point where these other technologies become economically and socially viable. I also see that our official currencies are also mostly based on trust and speculation (this is obviously ignoring other economic factors such as production and earnings) and so see crypto as a new globalised currency that, using smart contracts, can help both businesses and individuals who transfer large sums across borders.

That said, I mine Ethereum and invest it into a tokenised Index fund inspired by the S&P 500. It's called Crypto20, and as the name suggests, it holds 20 of the top performing coins on the market. I feel that this significantly reduces my risk and allows me to focus on the long-term gains.

I invested $1800 in November at $0.8 per coin and the current value is roughly $2 after 4 months. That puts my potential earnings at $1440. I only put in as much as I was willing to lose. Now I mine and use what I make from mining to invest in Crypto20. Within the next few months, I plan to withdraw the cost of my miner $2500 and the initial $1800 to break even, leaving the mined Crypto20 fund for the next 10 years. I may not withdraw the initial cash injection, instead, leaving it to mature, or not, as I was willing to lose it in the 1st place.

Now this is a shill without any logical discussion. I invested in a specific X and now it’s worth X. Nothing significant was brought to the table.

That said, I mine Ethereum and invest it into a tokenised Index fund inspired by the S&P 500. It's called Crypto20, and as the name suggests, it holds 20 of the top performing coins on the market. I feel that this significantly reduces my risk and allows me to focus on the long-term gains.

And of course this index fund has filed prospectus with the SEC...right?

Has there been discussion about investing in blockchain tech without buying a coin? I don't believe in the future of the coins in the near term.

As an example, Microsoft is looking to take advantage of open-source blockchain tech, without buying any tokens. So you should have residual exposure from your index funds in the event that large players like MS increase profits through blockchain tech.

Other than stock-picking the corps that look to be investing the most heavily in blockchain, I am not currently aware of a way to do what you are asking.

There are some cryptos that seek to flatten out volatility by operating a pool of investment capital as some combination of USD and top performing cryptos, but at that point you are still fully in the crypto world as you would be buying their token to participate.

That said, I mine Ethereum and invest it into a tokenised Index fund inspired by the S&P 500. It's called Crypto20, and as the name suggests, it holds 20 of the top performing coins on the market. I feel that this significantly reduces my risk and allows me to focus on the long-term gains.

Hey Fantasticmrfox,

A true crypto-index fund would be very useful. I looked over Crypto20, it's a cool concept. A couple turnoffs:

-it is not an index, at all. Don't fool yourself that you are gaining the benefits of a true index, which requires broad market coverage from the smallest to the largest to distribute risk and capture growth across the entire spectrum.

-if you wanted these 20 coins(I daresay you could choose a better 20 with a couple hours of googling), you would be MUCH better off buying them a la carte and controlling your own private keys. By investing in Crypto20 you are turning over control of your assets in the hope that they will return them to you when you ask. There's a non-zero chance that they wont, this defeats the entire point of crypto, which is you control your own finances and do not have to trust a 3rd party.

-Crypto20 appears only a couple months old. Essentially you are taking on the risk of a fledgling token with the growth rates 20 coins from the top 50 or so. That's a terrible trade IMO.

-finally, the 20 coins covered include some that I wouldn't touch with a 30 foot pole, and some that have flaws that may or may not preclude them from long term viability. Some are solid, some I haven't looked into.

"We examine the potential role of CCs in terms of offering diversification in a global portfolio, given both their high returns over the past several years and their low correlation with the major asset classes, offsetting some of the cost of high volatility. If past returns, volatilities and correlations persist, CCs could potentially have a role in diversifying one’s global bond and equity portfolio."

I am still bullish on using asset allocation strategies like the Larry portfolio, Golden Butterfly, and Bernsteins teachings but including CC in them as a diversifier and hedge. The returns on the modified Golden butterfly portfolio are beating S&P 500 (90/10), pure GB, Larry, and all the other asset mixes I track even with the crazy volatility. I tilt towards diversification and portfolios with the highest returns and the lowest potential drawdowns however. Drawdowns do not concern most people on this forum and if that is the case just stay 100% in VSTAX and keep hating on CCs (and gold).

Whatever the merits of cryptocurrency, a portfolio including it is not a portfolio with the lowest potential drawdown. Since cryptocurrency has the shortest track record of asset mentioned in the above post, plus many analysts pointing out the possibility/probability of larger drops than any other "asset" class, a crypto-heavy portfolio has the highest potential drawdown. Whatever rewards it may bring, such a portfolio incurs a larger risk.

Our MMM community seems to include both crypto-skeptics and crypto-boosters.

But let's say that I'm a crypto-skeptic. Does that still mean the optimal allocation to crypto is zero? I can see how the variability of price means I can rebalance to having 1% of a portfolio in crypto and feel like I'm well-positioned for a low-probability, high-value future in which the boosters are vindicated.

Our MMM community seems to include both crypto-skeptics and crypto-boosters.

But let's say that I'm a crypto-skeptic. Does that still mean the optimal allocation to crypto is zero? I can see how the variability of price means I can rebalance to having 1% of a portfolio in crypto and feel like I'm well-positioned for a low-probability, high-value future in which the boosters are vindicated.

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If you allocated 1% of your portfolio to every scheme or technology that could theoretically boom in value you’ll very quickly have a portfolio that is 100% rubbish. Even if your number 2 outcome came about (and I also thoroughly disagree with your ridiculous assessment there of ‘likely’) the chance of ‘cryptos eventually boom’ meaning that the Bitcoin (or any other currently existing coin) you’re holding today specifically represents that future value is exceedingly unlikely.

Come on mate, you've been around long enough to see this discussion had before. If you want to gamble/speculate with your money on sketchy internet ponzi schemes plagued by scams, hacks, propaganda and misinformation instead of investing it according to well studied and historically sound asset portfolios, go ahead, but don't call it 'optimal' or 'well-positioned'.

Has there been discussion about investing in blockchain tech without buying a coin? I don't believe in the future of the coins in the near term.

If it has any practical application towards competitive advantage for existing firms (lol it doesn't and never will) it'll be covered by your index funds. It is completely safe and preferable to ignore it for now. Better future techs to speculate on would be things like solar and other renewables, machine learning, maybe VR/AR, etc. Better yet, don't speculate and instead let your productive assets (stocks/bonds/real estate) work for you to produce income over time.

But let's say that I'm a crypto-skeptic. Does that still mean the optimal allocation to crypto is zero?

Yes. Yes it does.

That's my personal opinion of course, and you can take it or leave it, but I wouldn't touch crypto with a ten foot pole made of other people's money. The entire space is rife with criminal manipulators with shady motivations.

The economic importance of blockchain, as a clever software idea, is definitely not clear yet but no one believes it is worth a half trillion dollars (the current market cap). Crypto bears all of the hallmarks of past scams, and none of the attributes of past emerging technologies like electricity, autos, or the internet. It's a bad investment and everyone is going to get burned, because it only exists to defraud retail investors. It was created for the sole purpose of criminal fraud (avoiding sanctions, making illegal purchases, and now rotating pump and dump securities fraud).

Who would willingly invest in something that was designed from the outset to cause financial ruin? Only the sharks doing the stealing, that's who. And the minnows they can trick into parting with their hard earned cash. Which are you?

its interesting that in this whole block chain portfolio discussion we always focus on crypto coins and none of the software companies or other applications.

It makes perfect sense, actually. Blockchain outside of the coins and scams is pretty boring (and open source) and lots of companies will use it for lots of useful/lucrative things - but you already probably own stock in those companies if you're an index fund investor. So there's really not much to discuss.

If you like to pick stocks, you could get interested in which companies are doing what with blockchain.

If you just like to gamble, then the coins are the only thing to talk about. Which is why people are so interested in talking about them.

I made an app recently to help ppl track their cryptocurrency portfolio value. It's probably only useful if you have coins outside of BTC, LTC, ETH and what's store on Coinbase because then you could just use Coinbase to track your portfolio. No registration required and all data is anonymous and only stored on your phone. https://itunes.apple.com/us/app/coinbuddy-track-your-crypto/id1271644974?mt=8

Yep, complete nonsense. Blockchain is a novel data structure, of academic interest, which has serious flaws (eg complete inability to scale without vast energy consumption) and is also wholly unneccessary because in the real world the average person is perfectly happy with centralised, trusted actors. The cost of trustless decentralisation is much too high to be a practical solution for literally any problem, and is also generally undesirable because trusted actors bring with them the benefits of regulation, reliability, accountability and system control (two examples; chargebacks, system updates - with blockchain solutions transactions are irreversible which is a terrible idea in general, and system updates require agreement and cooperation between distributed actors, which, for example, is why the Bitcoin block size has not been changed in way too long and every attempt to do so ends in a reddit meme war).

Plenty of companies have done your 'behind the scenes' secret trials and the reason you don't hear about them is because they don't amount to anything.

I can see some uses. Blockchain is a distributed ledger. So you could use to do things like track the provenance of pieces of art, or maybe firearms, diamonds, cars, bottles of alcohol, real estate, or anything you wanted to keep track of.

So it might be useful, but it is an incremental step in bookkeeping. It isn't like discovering fire or antibotics.

I can see some uses. Blockchain is a distributed ledger. So you could use to do things like track the provenance of pieces of art, or maybe firearms, diamonds, cars, bottles of alcohol, real estate, or anything you wanted to keep track of.

So it might be useful, but it is an incremental step in bookkeeping. It isn't like discovering fire or antibotics.

Or you could use a permissioned database and not have to worry about block generation, inability to correct mistakes, etc.

The closest thing to a practical application that blockchain has is Github. And it's not blockchain.

Ok you guys have won. I am tired of contributing anything to this board. I (Naively) was hoping for a logical, constructive conversation about crypto on probably what I thought was the best FI board on the internet. The community that is mostly responding to this thread now is hostile and too emotional for useful discussion.

Edit: I am wrong to say the whole community. There is a large percentage of people who are amazing, thoughtful, and actually trying to help others get to FI. Those are the virtuous people who make this community great. The thread started out well and there are many people trying to help out and provide useful information. I wish I could isolate to just those posters, but I cannot and it seems like now if you post ANYTHING positive on this thread, you get massivly attacked.

Sounds like the same old arguments for the internet in the 90s. Ya right, chat room is really going to revolutionize society. Napster is for theives, nobody wants a lower quality MP3 if they can get a CD. Shopping online? Why would I do that when I have to pay shipping, wait a day or two, and I can just drive to the store? What a stupid idea...

Most people just do not have the time or energy to understand why it is so important. This is normal and ok. Eventually, you will understand when it is the backbone of society. Early adopters that see the potential want others to prosper, especially on this board since so many other ideas have helped everyone here towards their journey to FI. Being so negative and closed minded is just hurting others and not logical. I am surprised that this board out of all boards is so closed minded about a potentially disruptive technology that can help many people in the world reach FI... Let's go attack stock options stragegies because that is "complicated", or maybe gold in our asset allocation, or some other useless investments because they are not S&P 500 or bonds. Oh and never EVER mention paying off your house because 100% loan and 100% into S&P fund at 33%+ ShillerPE is the right choice every time.

There is a large percentage of people who are amazing, thoughtful, and actually trying to help others get to FI.

Thanks. Your recognition of my efforts genuinely means a lot to me. Sometimes I feel like I spend all this time and effort trying to help people, and all I get is attacked for it. I'm still here plugging away though, warning people away from bad investments.

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it seems like now if you post ANYTHING positive on this thread, you get massivly attacked.

Yea, I know how you feel. I keep trying to give people helpful advice in this thread, and some of them just get all huffy instead of listening. That's okay, not everyone on the internet actually wants to have a logical and constructive debate. Some people are just here for the confirmation bias.

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Sounds like the same old arguments for the internet in the 90s. Ya right, chat room is really going to revolutionize society. Napster is for theives, nobody wants a lower quality MP3 if they can get a CD. Shopping online? Why would I do that

Funny, I was recently thinking that the crypto hype was much more like the segway hype. It's going to revolutionize the way we organize cities! It's going to bigger than the PC!

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Eventually, you will understand when it is the backbone of society.

I think crypto will be hugely important. Blockchain, not so much.

The backbone of society? That's trust, not encryption.

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I am surprised that this board out of all boards is so closed minded about a potentially disruptive technology that can help many people in the world

What is it about cryptocurrency that you think is disruptive? What industries will be disrupted? I'm just not seeing what all the hype is about. It's a clever software idea, but in it's current form it's poorly implemented and in it's ideal form I still don't see a use case that isn't better served by existing alternatives.

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Let's go attack stock options stragegies because that is "complicated", or maybe gold in our asset allocation, or some other useless investments because they are not S&P 500 or bonds.

We don't attack stock options because they are complicated. We attack gold for the same reason we attack cryptocurrency.

I applaud your enthusiasm and I encourage you to invest your own money in any way you think is wise. You can even come here and tell us all about it. But when you cross the line into trying to convince other people, largely new investors who don't know any better, to invest their money just so that you can make more money? Now you're looking a little shady. You don't seem to understand the fundamentals of crypto as an asset class, as distinct from its fundamentals as a technology, and lots of people have tried to explain the difference to you with little or no success.

But please, continue to offer us your opinions and we will continue to offer you slightly different opinions, and the forum will record our conversation as a record of the points on both sides. If you're right, you'll win fabulous prizes!

Corrected. Pirating != theft, no matter how often the RIAA or similar tries to drown us in that particular bit of propaganda. One is making an illegal copy, one removes the original from the rightful owner and therefore does more damage and is a worse crime.

But yes I agree, Napster was 100% for pirates. Even today although torrenting does have some legitimate use-cases, it's still mostly for pirates and will never replace direct download.

Corrected. Pirating != theft, no matter how often the RIAA or similar tries to drown us in that particular bit of propaganda. One is making an illegal copy, one removes the original from the rightful owner and therefore does more damage and is a worse crime.

But yes I agree, Napster was 100% for pirates. Even today although torrenting does have some legitimate use-cases, it's still mostly for pirates and will never replace direct download.

Agreed, I was just trying to keep consistent language.

Napster is a great comparison to Bitcoin though. It was a new technology (P2P sharing), it popularized use of new technology (mp3s), it became popular because of the benefit for illicit use, it was the top of the pile for a while and then it was supplanted by related new technology (torrents) and was totally unable to make any money in the end despite all that early promise.

If you invested in Napster because you believed in the usefulness of the underlying technology - P2P sharing, you would kinda look like an idiot today. The argument that you should invest in Bitcoin because you believe in the usefulness of the underlying technology - blockchain . . . well, I guess time will tell.

Even today although torrenting does have some legitimate use-cases, it's still mostly for pirates and will never replace direct download.

Torrent downloads should replace free direct downloads in most cases. The best way to publicly distribute large files over the internet is through torrent downloads where the publisher continuously seeds the torrent. If few people are downloading the file, they'll mostly direct download from the publisher; if many people are downloading the file, the peer-to-peer network will relieve strain on the publisher's server and increase throughput for everyone. This is why many Linux distributions use torrents. For large files, the only reason not to torrent is to control who has access to the download.